Alibaba launches blockchain pilot to tackle fake food

E-commerce giant Alibaba has rolled out a pilot trial that uses blockchain technology to trace an authentic food item across the whole food supply chain.

The technology allows Chinese shoppers to get a definitive answer on the authenticity of a product they have bought by scanning a code on the product with their smartphones.

So far, only two products are enlisted in the trial, one from Australian food company Anchor and another from Australian health food business Blackmores, according to an Alibaba spokesperson.

According to a statement from the company, the project aims to use a blockchain database to ‘achieve end-to-end supply chain traceability and transparency to enhance consumer confidence and build a trusted environment for cross-border trade’.

As soon as a food product arrives to the consumer in China, they can scan a quick response (QR) barcode on the packaging to check the database and see if the product is genuine.

Alibaba’s pilot attempts to tackle food fraud in the Chinese food industry, which has led to crises such as counterfeit soy sauce, rice, and eggs that are potentially fatal when consumed.

The cost of fake food to the global food industry is around $40bn annually, according to Michigan State University researchers in the US.

Alibaba founder Jack Ma said that his company’s automated systems have already resulted in fake items being identified before reaching the consumer, leading to a 25% reduction in take-down requests over the last decade.

A spokesperson for the company added: “Once the pilot is complete and if successful, the framework could form the basis of a global supply chain model applied across all of Alibaba Group’s ecommerce markets.”

A report from the International Data Corporation (IDC) estimated that businesses worldwide will double their spending to £2.1bn on blockchain technologies this year, and predicted that this figure will reach $9.7bn in 2021.

IDC research director Bill Fearnley Jr said that many more firms are collaborating with blockchain specialists ‘to develop innovative solutions that improve processes such as post-trade processing, tracking and tracing shipments in the supply chain, and transaction records for auditing and compliance’.